The financial ratios for artz, inc., and the industry are as follows: artz industry current ratio 2.50 3.0 acid-test ratio 1.38 1.5 days in receivables 48.67 days 40.0 days days in inventories 117.32 days 70.2days operating return on assets 15.2% 12.5% operating profit margin 11.1% 8.0% total asset turnover 1.36 1.6 fixed asset turnover 3.46 3.1 debt ratio 36.4% 33% times interest earned 8.33 6.0 return on equity 15.0% 11.0% b. interpretation 1.artz, inc., is definitely less liquid than the average firm in its industry. both the current ratio and acid-test ratio are lower, indicating that artz has fewer liquid assets relative to the company’s maturing obligations (current liabilities) than the industry. also, both the accounts receivable and inventory move slower through the working-capital cycle than is true for the average firm in the industry. 2.management is performing better than the industry in terms of earning profits on the firm’s assets—15.2 percent operating return on assets compared to 12.5 percent for the industry. the reason for the higher return on assets comes from the higher operating profit margin: 11.1 percent for artz versus 8 percent for the industry. thus, the company is keeping its costs and expenses lower per dollar of sales. on the other hand, artz is less efficient at managing its assets, as shown by the lower total asset turnover: 1.36x for artz as compared to 1.6x for the industry. this lower turnover is attributable to the slower collection of receivables and more days in inventory